QUBT

• Strategic Acquisitions and Manufacturing Expansion

  • Completed 3 strategic acquisitions in the first half of 2026 that expanded technical capabilities, manufacturing capacity, engineering talent, and customer reach across high-growth markets including photonic semiconductor manufacturing, AI, defense, aerospace, telecommunications, and quantum technologies.
  • Completed the acquisition of Enhanced Semiconductor, a leading U.S.-based independent advanced package foundry, which allowed the company to launch its Fab-2 manufacturing initiative ahead of schedule, expanding advanced packaging and semiconductor manufacturing capabilities for its core nanophotonics and thin-film lithium-niobate platform, and adding new commercial and government customers.
  • Expanded U.S.-based manufacturing from the original Fab-1 facility in Tempe, Arizona to the newly added Fab-2 facility, increasing total production capacity to meet growing demand across target markets.

• Product Commercialization Milestones

  • Announced that Neurawave, the company's next-generation photonic reservoir computing platform for low-power edge AI inference and advanced signal processing, reached commercial readiness in April 2026.
  • Successfully delivered and installed a Dirac-3 quantum optimization machine at a global consulting firm for complex enterprise optimization use cases including portfolio optimization, marking a key commercial milestone for the company's quantum optimization business.
  • Reached a framework agreement with Planck Dynamics including an initial purchase order for 5 Neurawave systems, with a pathway for a potential total deployment of dozens of systems representing an aggregate potential program value of over $10 million, validating the commercial viability of the company's photonic computing technology.
  • Received a purchase order for a Quantum secure communications system from a leading global university for quantum secure networking R&D, demonstrating ongoing commercial traction for the company's quantum communications portfolio.

• Core Strategy and Vision

  • The company's long-term vision is to develop scalable, room-temperature, chip-scale quantum systems based on nanophotonics and advanced packaging that can be manufactured at volume, making quantum technology smaller, more practical, more affordable, and accessible to a broad user base.
  • The company pursues two complementary growth engines: advancing its quantum technology roadmap to commercialize practical quantum systems, and growing a portfolio of commercial photonics products, semiconductor manufacturing, and foundry services that generate current revenue while supporting long-term quantum technology development.

• Management reaffirms its prior full-year 2026 revenue estimate of $20 million to $25 million for Quantum Computing Inc. before including the contribution from the Enhanced Semiconductor acquisition.
• Enhanced Semiconductor's 2026 revenue contribution is expected to fall between $7.07 million and $16 million, depending on the delivery and acceptance timeline of its ongoing customer projects, which are difficult to predict for cutting-edge development work.
• The company's 2027 earn-out goals for the Enhanced Semiconductor acquisition are predicated on a $35 million annual revenue target for that business.
• Planned CapEx for upgrades to the Fab-2 facility is projected to total between $50 million and $100 million (with a midpoint of ~$75 million), with minimal spending expected in 2026 as the project remains in planning stages.
• Management does not provide formal full company guidance at this time.

No formal separate product segment financial breakdown was provided in the transcript. Total company revenue for Q2 2026 was $5.6 million, compared to $61 thousand in Q2 2025 and $3.7 million in Q1 2026. Revenue is broadly sourced from government, educational, and commercial customers, with 70% to 80% of total revenue currently coming from government contracting (mainly as a subcontractor), followed by commercial customers, then educational customers as a distant third. Most Q2 2026 revenue came from sales of photonics products that support both the company's quantum roadmap and existing industrial applications. As of June 30 2026, total company contract backlog was $42.5 million, much of the increase from Q1 2026 end backlog comes from the Enhanced Semiconductor acquisition. For the acquired Enhanced Semiconductor business, it generated approximately $16 million in revenue in the first half of 2025, with 2027 earn-out goals predicated on a $35 million annual revenue target; its recent revenue has declined slightly due to delayed funding on a large U.S. Navy contract pushed to 2027.

• Revenue from the company's advanced technology and government contract projects is inherently lumpy, and delivery timelines for contracted projects can shift due to technical development challenges, leading to unpredictable quarter-to-quarter revenue performance.
• Development of gate-based single-photon quantum photonic systems faces significant engineering challenges, including achieving required photon-photon interaction for quantum logic, managing optical loss to maintain single photon integrity, and integrating all required components (lasers, detectors, control electronics) on a single heterogeneous chip.
• Forward-looking statements regarding expected product development, commercial growth, and financial performance are inherently uncertain, and actual results could differ materially from expectations due to identified and unforeseen risks, which are detailed in the company's SEC filings including its Form 10-K and most recent Form 10-Q.
• The shift in business mix from government contracting to a larger share of commercial revenue is expected to occur gradually, and there is no guarantee that expected commercial market growth will materialize as projected.

Q: What progress has been made on expanding variable capacity for the Dirac-3 quantum optimization machine, and how will this impact market opportunities? / A: Management confirmed significant progress has been made on increasing the number of variables the Dirac-3 system can support, with public announcements of this progress expected in the coming months. Expanding variable capacity is expected to unlock additional new markets for Dirac-3 by enabling more use cases, building on the system's already demonstrated quantum advantage for solving complex NP-hard optimization problems compared to classical and competing quantum systems. The Dirac-3 is differentiated from other quantum optimization systems by its room-temperature operation and photonic architecture, which reduce complexity, cost, and power use for practical real-world deployment.

Q: How have CapEx needs for the Fab-2 initiative changed following the Enhanced Semiconductor acquisition? / A: The acquisition already adds substantial existing manufacturing capacity, with Enhanced currently capable of producing roughly 60,000 wafers per year, a large increase over the original Fab-1 facility. Total CapEx for required facility upgrades is projected between $50 million and $100 million (midpoint ~$75 million), which is far lower than the cost of building a brand new facility from scratch. Little of this spending is expected to occur in 2026, as the upgrade plan is still being finalized.

Q: What is the current breakdown of revenue across government, commercial, and education end markets, and how is this balance expected to shift? / A: Currently, 70% to 80% of total company revenue comes from government contracting, mostly as a subcontractor to prime contractors, with commercial as the second-largest segment and educational a distant third. Management expects this balance will gradually shift over time as commercial market demand for quantum and photonic products grows, but government contracting will remain the dominant revenue source for the foreseeable future. Backlog, which stood at $42.5 million as of Q2 end, will be fulfilled over 12 to 18 months, so it is not expected to be fully realized by the end of 2026.

Q: What are the key engineering challenges for the company's planned gate-based single-photon quantum photonic machine, beyond optical loss management? / A: Beyond managing optical loss, the most critical and challenging hurdle is achieving functional photon-photon interaction, which is required to build quantum logic gates. Additionally, the company aims to build a complete fully integrated room-temperature system that can work alongside conventional computing platforms, which requires integrating lasers, single-photon detectors, and control electronics all onto a single heterogeneous chip. This integration need is a core driver behind the company's recent acquisitions of semiconductor and advanced packaging firms, which provide the required manufacturing capabilities for this roadmap.